Fiscal Impact of the Connecticut DREAM act
The immediate fiscal impact of the Connecticut DREAM act is difficult to determine, but is likely to be small. The long-term economic impact is likely to be positive. Undocumented populations in Connecticut Because of the difficulty in keeping statistics on undocumented students, there are no good estimates of the number of students who would be eligible to receive in-state tuition under the act. There is also no estimate of the number of students currently enrolled in Connecticut higher education institutions at out-of-state costs. In the 10 states that currently grant in-state tuition to undocumented workers, most are unable to estimate the fiscal cost, but believe that it is very small. One state that did make an estimate was Kansas, where 30 of the estimated 370 eligible students enrolled. In 2008, the Federation of Americans for Immigration Reform estimated that Connecticut's undocumented immigrant population was 115,000 out of 3,500,000, or roughly 3.3% of the state's population. By means of comparison, Utah, which is estimated to have an undocumented population of 100,000, saw 22 students take advantage of in-state tuition in 2005. In contrast, Kansas, with an undocumented population estimated near 80,000, saw 221 undocumented students receive in-state tuition in 2005. According to report by the Yale Roosevelt Institute, between 150 and 300 students will be affected every year. However, the report fails to take into account the lower graduation rate of undocumented students than that of the Connecticut average, though ameliorating this graduation gap is an intended effect of the legislation. Fiscal Impacts in Other States The New Jersey Public Advocate's office report argued that the fiscal impact would be positive, as increased enrollment would bring in more revenue than might be lost from lowering tuition, as students who hadn't been able to afford to attend New Jersey institutions would do so. A HEAA report on the prospects for a Colorado DREAM act found that in the 10 states that had passed similar legislation, the fiscal impact had been either negligible or positive. A 2007 Federal Reserve Bank of Boston report suggests that granting in-state tuition would have net positive economic effects. Undocumented workers pay more in taxes than they use in services. Higher education increasing earning potential (and therefore tax revenue) while decreasing the likelihood of crime, drug use and other social ills that cost state resources. The act encourages high school graduation, even if students don't go on to higher education, and reducing drop-out rates also has a positive economic effect. Fiscal impact for Connecticut The Connecticut Office of Fiscal Analysis 2010 report expects that the act would produce a revenue loss for UConn, but a revenue gain for Connecticut State University and the community college system. This is because UConn has reached full capacity for enrollment, and additional students paying in-state tuition would likely replace out-of-state students. Other CT universities and colleges have open enrollment, and would see a revenue increase from gaining additional students. The gain from increased enrollment would outweigh any losses from current students being able to switch to the lower rate. Due to the inability of undocumented students to apply for financial aid such as Stafford Loans or Pell Grants, however, is it likely that few undocumented students will attend the more costly University of Connecticut. Though the Yale Roosevelt Institute report predicts that the bill could cost between $600,000 and $3 million dollars per year, and suggests that the lower estimate is more likely. However, these are conceded to be "upper estimates;" the Yale Roosevelt Institute report fails to accomodate for the note from the Office of Fiscal Analysis above, and assumes the cost formula to be a simple subsidy of the difference between in-state and out-of-state tuition for each affected student. This is not the method of calculation used in allotting funds to Connecticut's state universities. In reality, the low numbers of students affected will be spread out among Connecticut's 24 public colleges and community colleges, and are unlikely to require the hiring of new faculty or expansion of facilities. Further, though the report points out that Kansas, the only state to record the college enrollment rate of undocumented students who have graduated from state high schools, reported a mere 8% participation rate, this data is not taken into effect in the report's calculations, though noted as a reason to favor the lower end of cost estimates. Undocumented immigrants already pay many federal and state taxes; according to an estimate by the Social Security Administration, three-quarters of undocumented immigrants pay into Social Security through automatic deductions from their paychecks. Because state taxes are also deducted from paychecks, it can be projected that three-quarters of undocumented immigrants also pay state taxes. Additional taxes are paid by undocumented immigrants in the form of sales taxes, gasoline taxes, and property taxes. These taxes go toward, among other expenses, public universities in Connecticut. The basis for giving in-state tuition is that a student and his or her parents have paid into the system over several years; the case can be made that undocumented immigrants who pay the same taxes deserve the same opportunity. However, according to a 2011 statement from the Office of Fiscal Analysis, the bill will have no fiscal impact on Connecticut. This is because, the note explains, "the University of Connecticut and the Connecticut State University System have policies or the ability to adjust the ratio of in-state to out-of-state students and therefore can make charging in-state tuition to persons without legal immigration status who reside in Connecticut revenue neural. The Regional Community-Technical Colleges currently have no such persons paying out-of-state tuition."